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Things to know

  • Employment agreements can be either verbal or in writing and for an indefinite term or fixed term
  • Employees must be provided with at least their minimum statutory entitlements in respect of terms and conditions of employment as set out in applicable provincial employment standards legislation
  • Written employment agreements are recommended at least if compensation terms are more complex,  (for example, benefit and pension terms, if provided, should be set out in an agreement)
  • Neither private benefit insurance or pensions are mandatory entitlements
  • Restrictive covenants, like non-competition provisions, non-solicitation provisions, confidentiality, and intellectual property protections need to be in writing.  To be enforceable, non-competition and non-solicitation provisions must be drafted narrowly. In Ontario, as of October 25, 2021, non-competition agreements with employees are void, other than (a)  for C-suite executives; or (b) in the context of a sale transaction in which such agreements are entered into as part of such transaction.

Things to do

  • Review your template employment offers and full agreements to ensure they are in compliance with Canadian law (for example, references to ‘at-will’ employment must be removed as this concept is not recognized in Canada)
  • Review your compensation structure and model, including incentive compensation and benefits, to ensure competitiveness in the market
  • Consider if you want to establish restrictive covenants or severance provisions and, if so, carefully draft them with legal counsel to ensure, to the extent possible, enforceability
  • If you want to hire foreign workers, such workers typically must apply for a work permit.  Any employment agreement drafted for such foreign workers must be consistent with representations made in the application for the work permit.
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